NSEIT & Bank of India Fails to Deliver on PAN India Auction System

Tea Board has initiated post auction settlement system for Pan India Auctions through the Settlement Bank – Bank of India – from Sale No. 37 (held in mid-September 2016). However, it has severely hampered post auction operations as the Settlement Bank & NSEIT, the facilitators of the e-auction system, have failed to interact in-depth with the Auction Organisers and grasp the requirements of the associated stake holders namely Sellers, Buyers, Auctioneers and Warehouses operating in the auction system. They could not satisfactorily resolve many concerned issues such as:

i. Delivery Orders which are negotiable instruments for delivery of tea worth crores of Rupees are being issued with digital signatures without proper infrastructure for verification of their authenticity by the warehouses prior to delivery of teas to buyers. This has increased the risk in the auction system.

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ii. While Buyers have downloaded Delivery Orders and obtained delivery of the teas, corresponding remittances to Sellers for the value of their teas and to warehouses for storage of teas have not taken place as per earlier system as Account Sales cannot be uploaded in individual company’s name through the Settlement Bank.

iii. Prompt payments cannot be reconciled as here again Account Sales are being generated in the name of garden Marks and not in the names of the selling Companies. Thus payments from Buyers are being kept in the Settlement A/c and are not being remitted to Sellers at a very crucial time when Puja Bonus is required to be paid as per statutory requirement.

iv. Brokers are unable to reconcile Tax Invoices and Account Sales due to numerous errors in total packages, net weights, sale dates, prompt dates, VAT, Service Tax, Cess, Tea Board Charges, etc which remains to be addressed by the NSEIT.